Contrarian Stocks for 2003
Screening for stocks near their 52-week lows yields some bargains.
In investing, consensus thinking can get you in trouble. If you buy what most everyone else is buying--technology stocks in 1999, bond funds today--chances are you'll be disappointed in your future returns. An easy way to break out of this consensus thinking is to regularly scan the list of stocks trading near their 52-week lows. These are the stocks most investors don't care about--the stocks that contrarians, as opposed to the consensus, will find interesting.
Within Premium Stock Selector, I created a screen to look for stocks trading within 15% of their 52-week lows. A good example is Novartis (NVS), a big European pharmaceutical company whose stock trades at $36 versus a 52-week low of $34. It's also a 5-star stock and an Analyst Pick, meaning its one of our favorite names in the health-care sector. Other large-cap stocks currently trading within 15% of their 52-week lows: Wal-Mart (WMT), Coca-Cola (KO), Fannie Mae (FNM), and Gillette (G).
Haywood Kelly, CFA does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.